Add 1: You can include the specific repository to a specific recording file which uses it. When you copy it, or use it in another project, you don't need to think about copying the repository items too.
Add 2: When you select it the repository will be included in the Recording.
Add3: They depend on what you are trying to do. In general it is common to not embed the repository to your recordings.

Thanks for the reply.
Add1: let me clarify this again with an example just to make sure we are in same page.
For e.g: If I have recordings, recording 1 and recording 2 in one repository file (e.g.repository1)
and another two recording, recordings 3 and 4 in another repository file (e.g. repository2),
then if I choose embedded repository option from Repository Module. It will combined repository 1 and repository 1 to one file embedded repository file.

Please let me know my understanding is correct regarding this.
If so, I would like to know the answers for the following questions.

1. Can we rename the embedded repository file to a user-defined name?
2. Once we select embedded repository option, could de-couple the bindings again (i.e; whether we could separate repositories again as repository 1 (for recording 1 and 2) and repository 2(for recordings 3 and 4)

I am afraid I don't understand what you mean with: "It will combined repository 1 and repository 1 to one file embedded repository file.".
It just mean that the recording files will also contain the specific repository.